San Diego Extends Bus Order, Bolstering New Flyer Backlog

Event summary

  • San Diego’s Metropolitan Transit System (MTS) exercised an option to purchase 73 compressed natural gas (CNG) buses from New Flyer.
  • The order, valued at approximately $64 million, includes 50 forty-foot and 23 sixty-foot Xcelsior® buses.
  • This purchase is part of a five-year contract initially announced in 2022, now in its fourth year.
  • The order adds 96 equivalent units to NFI Group’s (NFI) fourth-quarter 2025 backlog.

The big picture

The order underscores the ongoing demand for transit buses, particularly in regions like Southern California committed to fleet modernization. While CNG remains a viable option, the long-term trend points towards zero-emission technologies, creating both opportunities and challenges for NFI. This $64 million order provides near-term revenue certainty but doesn't negate the need for continued investment in alternative propulsion systems.

What we're watching

Contract Renewals
The MTS order highlights NFI’s success in securing contract extensions, but the expiration of the current agreement in 2027 will be a key test of the partnership's long-term viability.
Emission Standards
Increasingly stringent emission regulations could accelerate the shift towards zero-emission bus technologies, potentially impacting demand for CNG buses and requiring NFI to adapt its product offerings.
Supply Chain
Continued supply chain disruptions and labor shortages could constrain NFI’s ability to fulfill existing orders and impact future backlog growth, despite the current order.